BAT works with Blockchain companies to create business cases for our partners.
BAT is working with some of the world’s leading corporations to introduce Blockchain DLT business benefits.
BAT is able to call on its extensive industry knowledge base and its technology acumen to produce Distributed Ledger Technology solutions in the financial markets.
BAT has established relationships with leading academics in the Blockchain world and is extensively researching the latest technology developments of Blockchain DLT.
BAT is currently developing new technology solutions that will enable interoperability between Blockchain and legacy systems.
“There are hundreds of startups with a lot of brains and money working on various alternatives to traditional banking.” — Jamie Dimon, JPMorgan Chase
What is a Blockchain?
A distributed database of computers that maintains records and manages transactions. Rather than having a central authority (such as a bank), blockchain uses the network to approve “blocks,” or transactions, which are then added to the “chain” of computer code. Cryptography is used to keep transactions secure, and the distributed nature of transaction approval makes the system harder to tamper with.
What does blockchain technology mean for financial institutions?
Collaborative technology, such as blockchain, promises the ability to improve the business processes that occur between companies, dramtically lowering the “cost of trust.” For this reason, it may offer significantly higher returns for each investment amount spent than traditional internal investments.
Current problems delaying blockchain implementation
Financial institutions such as banks and brokerages have long held the position of the trusted third party validating the authenticity and accuracy of a transaction. Blockchain significantly alters the need for this trusted third-party middleman.
The biggest problem with blockchain technology now is that it is hard to apply, mainly because, as is typical with open source projects, there are numerous projects each with their own teams and ideals. Marrying all of the functionality into a practical application is difficult.
How is blockchain related to Bitcoin?
Blockchain is the technology that enables the existence of cryptocurrency. Bitcoin is the name of the best-known cryptocurrency, the one for which blockchain technology was invented. For consumers, cryptocurrencies offer cheaper and faster peer-to-peer payment options than those offered by traditional financial services businesses, without the need to provide personal details.
While cryptocurrencies continue to gain some acceptance as a payment option, price volatility and the opportunity for speculative investments encourage consumers not to use cryptocurrency to purchase goods and services, but rather to trade it. However, cryptocurrencies carry groundbreaking potential to allow consumers access to a global payment system—anywhere, anytime—in which participation is restricted only by access to technology, rather than by factors such as having a credit history or a bank account.
What is the disruptive potential of blockchain technology?
The technology that underlies cryptocurrency has the potential to disrupt a wide variety of transactions beyond the traditional payments system. Financial services organizations could use the blockchain anywhere records are stored digitally and in any type of transaction that currently needs to be verified by a trusted third party. These transactions include but are not limited to transferring digital or physical assets, protecting intellectual property, and verifying chain of custody. In an era of cybercrime and stringent regulatory requirements, a highly fraud resistant system for protecting and authenticating almost any kind of transaction could have a revolutionary impact on the financial industry.
How are banks implementing blockchain technology?
In the financial services industry, blockchain technology is already being implemented in innovative ways. Many exchanges and banks around the world, including the London Stock Exchange have formed working groups to investigate how blockchain technology can be used to enhance clearing, settlement, and reporting of trades. Citigroup, Barclays, and Deutsche Bank are among the banks investigating incorporating blockchain into their payments system.
What is the Blockchain forecast for 2017?
- Organizations protecting their intellectual property as they explore new collaborative opportunities with customers, suppliers, and competitors
- Large financial institutions will need strategic plans to set parameters for technology risk taking
- Market participants will start to develop the processes that surround the transactional layer
- Blockchain may result in a radically different competitive future in the financial services industry, where current profit pools are disrupted and redistributed towards the owners of new highly efficient blockchain platforms.
The European branch of the International Securities Association for Institutional Trade Communication (ISITC) has proposed 10 blockchain benchmarks it believes will help standardize the increasingly diverse set of blockchain tools currently available on the market.
Created by the ISITC’s Blockchain DLT Working Group at a meeting, the benchmarks are the latest step in a series of global efforts aimed at ensuring blockchain can enable a new wave of efficient, decentralized data sharing without recreating today’s siloed centralized database infrastructure.
But creating reliable standards across industries and borders is about more than just helping ensure interoperability, according to co-chair of the ISITC Blockchain DLT Working Group, Gary Wright. Rather, the creation of blockchain standards is a key step towards improving the bottom line for companies that use distributed ledger technology.
Gary Wright also sits on the European executive board of ISITC and co-founded London-based Block Asset Technologies.